FINANCIAL LIFE PLANNING

Ross Levin

We ’ re constantly looking at our own firm to consider what we do right and wrong .

VERY YEAR OUR FIRM , ACCREDITED INVESTORS WEALTH

Management , hosts a program called “ Be Our Guest ,” in which , for a donation to the Foundation for Financial Planning , 20 advisors can come to our offices and watch us for a day to see how we run our firm .

In this column , too , I ’ ll share some thoughts about our firm — some of the things I think we ’ ve done well over the years and some of the things that are still works in progress .

For instance , I think we ’ ve done a good job of acting as fiduciaries — trying to do the right thing , in the right way , at the right time for clients . And being fiduciaries means correcting errors we ’ ve made . I think particularly about a massive trade error that we made ( and then fixed ) for an 80-year-old client . We mistakenly bought an emerging markets bond fund rather than a stock fund for a client . By the time we discovered it , the trade moved against us . The cost of fixing the error ( reversing the trade ) was around 20 % of our revenues that year . The client would not have noticed the mistake , so we could have simply sold the wrong fund and replaced it with the one we meant to buy . I think our decision on how to handle this would determine not only who we were , but what we would become . It was a terrible moment , but also transformative , because we knew our job was to act as fiduciaries and fix our mistake : It made us ask , “ If a mistake cost us $ 1 , what would we do to fix it ?” We should do the same thing , regardless of the cost .

There have been emotional aspects to running our firm well , too . My co-founder , Wil Heupel , and I eventually learned to manage our egos and value our differences . The success of the firm evolved from our shared values of what we wanted clients to receive , as well as from our significant differences in skills and talents . Originally , I valued my contribution — of being a public face of the firm and , by extension , bringing in clients , as well as thinking about our future — more highly than Wil ’ s contributions of figuring out how to actually deliver on the things we thought were important to make that future possible . That thinking was egotistical and wrong of me . The appreciation of our differences allowed us each to spend more time getting better at the things we did best rather than trying to get good at all things .

I believe another thing we did right was care about each other and our staff . I have said before that even though we are a family business , we don ’ t hire family members . Wil and I have grown daughters similar in age , but when they were very young , we agreed that they could not join our staff because we felt that it could limit the opportunities for others . One of my daughters is a lawyer , the other has her doctorate in psychology , and those are skills we need here . Not hiring them might even be an unnecessary burden ; I ’ ve seen firms where the founders ’ or executives ’ family members indeed add tremendous value . But I believe that not having offspring in the firm has been a comfort to Wil and me ( and our 10 other shareholders ), since we ’ ve avoided having to deal with family members who might not actually have been good in their jobs . If my daughters were not a good fit , it would have been very challenging to make a good choice about their future .

We have always been a planning-first organization , using a process that covers all aspects of our clients ’ lives . We have a team of four on each client , we have specialists in a variety of areas that can come into client meetings , and we advance staff when the staff member is ready for a bigger role , even if it may be before the firm is ready to open that role . While it can be expensive to have people advance to higher-paying jobs before we need to add capacity from client overload , moving people up when they ’ re ready makes them more likely to stay . That helps us with client continuity — important since over 40 % of our new clients come from existing clients , and clients value that seamlessness in their relationships .

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